The good… construction
In construction, HR received positive feedback for its contribution to pay and benefits, training and occupational health. Of all the sectors we surveyed, construction had the highest proportion of respondents (57%) who believed HR understood the needs of the business. We asked Alec Luhaste, HR director at Taylor Woodrow, why construction holds HR in such high regard.
“I’m only the second HR director this company has had. I have been here five years and my predecessor was here for about four,” says Alec Luhaste, HR director at construction and house-building firm Taylor Woodrow. “That in itself says something. I don’t think construction is necessarily an industry that is used to HR people and processes.”
With a 25-strong HR team, Luhaste oversees the HR and employment needs of 8,500 employees worldwide. He is not surprised there is still some suspicion about what value HR can bring to the table, particularly in areas such as succession planning and performance management.
“People are very practical in this industry that is one of its attractions. They are also very enterprising, but that can also mean they do not like rules and processes,” he explains.
For HR to be heard and have its messages acted on, it is very much a question of speaking, acting and delivering in a way that managers understand and can relate to, Luhaste points out.
“It is about putting in simple processes and frameworks that line managers can work within,” he explains.
Key challenges in the industry include its injury, fatality and absence rates, its high levels of staff turnover, high ratio of foreign or migrant workers, and a continuing lack of female employees and managers.
Taylor Woodrow has faced the additional challenge of integrating workers from a succession of mergers and acquisitions. “We’ve had to ensure this hasn’t disrupted the business, so it has been quite hands-on,” says Luhaste.
“Because HR people are quite new in this sector – at least in our company – the function has had quite an impact and added to the bottom line,” he stresses.
“But when it comes to building up trust, that’s something which takes time and will not happen overnight. It is about creating a healthy respect.”
Taylor Woodrow has just run its third annual employee survey and now 95% of workers say they have a personal development plan and appraisal.
“People are now much more open to change. Our employees are incredibly positive about working here,” Luhaste adds.
“We have benefited from bringing in a lot of bright people and letting them grow with the business, giving them experience and promoting them fairly quickly.
“We have also encouraged people to come in from other industries who can bring ideas with them.”
The bad… financial services
HR in banking, finance and professional services gets the biggest thumbs-down in the Personnel Today research. Only about one-third of respondents felt that HR understood the needs of the business, while only 32% thought the function added value. We asked Cathy Wilcher, HR director at Co-operative Financial Services, how she is overcoming this negative image.
HR’s performance in the financial services sector is disappointing, but in an industry that is uniquely challenging, perhaps not a complete surprise, argues Cathy Wilcher, HR director at Co-operative Financial Services (CFS).
“One of the real challenges any HR person faces in this sector is understanding the business,” she says. “You could probably say that about any sector, but I do think that in financial services there is a greater degree of complexity, plus there is scrutiny from the Financial Services Authority and, increasingly, from consumers.”
Wilcher, previously HR director for employee relations and reward at high-street bank Abbey, joined CFS in April this year. She manages an HR team of 200, which services the needs of about 10,000 employees.
“As an HR professional, you need to be very, very close to the business. You need people with credibility and professional expertise and knowledge of the business,” she says. “As a function, we need to be working all the time to build commercial partnerships.”
At the moment, CFS is going through a restructuring process, so it is even more important that HR is able to sit at the table and add value.
“Adding value to the organisation, particularly in areas such as change management and leadership succession, is crucial. What we need to do is find partners within HR that really add to our credibility,” she says.
Wilcher points to a recent partnership with Lancaster University on leadership development as a good case in point. “It is really important that HR professionals in this sector partner up with business people and external suppliers who have real credibility in their own sector.”
One recent initiative has seen the HR team put in place a licensing process for choosing business partners. This has meant the business can be sure it is linking with organisations that have a proven track record in areas such as leadership skills, innovation and product development.
“Partners need to understand how we develop products and how we bring them to market. They need to be able to speak from real experience,” says Wilcher.
Developing and nurturing the talent in your HR team is an obvious must. But Wilcher stresses that HR people should get exposure to the commercial side of the business and, ideally, the business should get exposure to HR.
The great… catering
Despite a reputation for high turnover and a fast-moving market, HR issues are high on the agenda in catering and hospitality organisations. Almost two-thirds of respondents in this sector felt the function understood the needs of the business, and hospitality HR scored highly for its approachability. We spoke to Gavin Wetton, HR director at restaurant chain La Tasca, to describe what successful HR looks like.
It may seem obvious, but the simplest way for HR to be heard and respected is to ensure that the people at the operational, sharp end of the business understand why adopting a particular procedure or process is beneficial to them. This is the view of Gavin Wetton, HR director at Spanish tapas restaurant group La Tasca.
The chain operates 64 restaurants around the country, employs more than 1,600 people (nearly two-thirds of whom are Spanish), and was a winner this year in the Best Places to Work in Hospitality awards run by Personnel Today’s sister title Caterer & Hotelkeeper. It is also shortlisted in this year’s Personnel Today Awards. Clearly, HR issues have a high profile in the company, as they do in the sector as a whole.
“It is all about ensuring people understand what’s in it for them. It is crucial to be able to apply this to your best practice. If you are committed to doing things in the right way, you have to be flexible in how you implement things so that it is right for the business,” says Wetton.
Performance management – one area in which HR was weak in the survey – is harder to tackle in catering because of high employee turnover and a large number of junior managers.
“There are some businesses in hospitality that can be quite reactive on things such as appraisal, so, again, you need to explain to people what the benefits are from having a good appraisal system,” he explains.
“There is a perception in the UK, unlike on the continent, that this industry is long hours and low pay, so it is partly up to HR to generate a more positive message.”
The key is to be accessible and approachable, Wetton argues. “You need to listen to your employees and get feedback from people who work in the business,” he says.
For instance, the managing partner profit-sharing scheme, which was launched in June 2002, came about through listening to feedback from the company’s restaurant managers.
“You need to align what you want with what the business wants. You need to incentivise people in a way that is right for your business,” says Wetton. “In hospitality, one thing we could do is more benchmarking, either through Investors in People or through external awards, so we are able better to emulate best practice.”